Is Your Hotel Getting Its Fair Share?

Is Your Hotel Getting Its Fair Share?

Posted: April 20, 2016

It’s a constant battle. Trying to win your fair share, or more, of guests coming into your market. The ability to gain or steal share is dependent on a range of factors from your rate and competitor rates to overall market demand and seasonality. The best way to understand your share is to first see how you’re benchmarking against competitors for consumer search and booking on travel websites. It’s a strong indicator of hotel awareness and competitive position.

Hotels should track their current share, changes over time, and forward-looking share for future arrival dates. In addition to seeing how a hotel is shopped and booked online, monitoring share of third-party bookings helps hotels evaluate online performance and distribution strategy compared to the competition.

nSight’s Search and Booking Penetration Indices provide a simple way to measure if you are getting your fair share compared to your competitors for specific arrival dates. Based on the number of hotel rooms you have searched/booked and the number of rooms available in your comp set, these metrics show if you are winning market share.

How to determine hotel performance against competitors

You get a quick snapshot of penetration from the nSight dashboard as shown in the snippet below.

In this screen, the hotel fair share is 9.43% of the searches or bookings within your competitive set. Here, the hotel has reached its fair share of bookings (109%) and almost doubled (198%) its fair share of search. All in all – a great performance for the hotel compared to its competitive set.

Start with Booking Penetration

We use this index to make sure you are getting your fair share of third-party bookings for specific arrival dates. This index incorporates two factors:

Your share of bookings and all competitive set hotels for a particular day.

Your hotel’s total room inventory within the competitive set (Your Fair Share).

For Example:

There are 2,000 rooms in your competitive set and you have 200 rooms.

Your fair share would be 10%.

If you are receiving 10% of third-party bookings then you will have 100% booking penetration, or 100% of your fair share.

If you are only receiving 9% within your competitive set then you will show a LOW booking penetration.

If you have a Booking Penetration of 15%. Then you are seeing 150% your fair share of bookings for that day – a HIGH booking penetration.

Follow with Search Penetration

Search is the best proxy for online consumer demand. If your hotel has strong and/or growing search, it’s an indicator of positive demand for your property, and ultimately bookings.

We use the Search Penetration index to make sure you are receiving your fair share of third-party searches. The index is derived by:

Your share of searches and all searches for competitive set for a particular day.

Just as with the booking index, if you are receiving 14% of Searches in your competitive set, then you will show a HIGH search penetration.

If you only receive 9% of third-party searches you will have a 90% Search Penetration, showing a LOW search penetration.

nSight can help measure your performance for both Search and Bookings compared to your competitive set. Use this information to assess if you are achieving your goals and where you need to focus in order to exceed fair share levels.

Fair share is an important measure of online performance of rate and distribution strategy that hotels can use to benchmark against other properties.